Note to Gospel for Asia: Indian Customs Also Requires Declaration of Aggregate Cash Transfers Over $10,000 (UPDATED)

Advisory: Due to questions presented by commenter JP below, I am investigating this issue again. There is no question that Gospel for Asia’s actions violated U.S. law but it is unclear to me now if GFA violated India regulations. I thought the form I attached below required declarations of aggregate amounts of cash over $10,000. Due to information brought by JP, I am not so sure as of 12/24/15. The information I have gotten is conflicting and so I contacted Indian authorities and will be report the results back here when I get an answer. Thanks to JP for raising the questions. Stay tuned…
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Original post:
While Gospel for Asia has admitted that GFA groups traveling together to India violated U.S. law by taking aggregate amounts of cash over $10,000 out of the U.S. without customs declaration, little has been said about Indian law.
Those who carried cash to India were told they had $4500 in an envelope which was to be given to officials at Believers’ Church headquarters in Kerala. The $4500 in cash was under the limit for an individual traveler. However, since whole groups traveling together transferred more than $10,000 from GFA-US to GFA-India, someone in the group should have declared the total amount.
As it turns out, Indian law also requires declaration of cash if the total per transfer is over $10,000. This is clear on Indian customs forms which would have been filled out by those entering India. See the customs forms below and check item 10, subpoint ix.
Customs form 1
 
Customs form 2It is hard to imagine that frequent India travelers like K.P. Yohannan and other senior GFA leaders had not seen this form.
 

Phoenix Preacher Raises Red Flags Over Gospel for Asia

Last week, the Phoenix Preacher blog ran a post titled Red Flags over Gospel for Asia. The post describes a GFA donor’s attempt to get answers to questions which have come up in recent weeks. It is good to see donors asking questions but not so good to see the responses. The blog author raised some of the issues I have covered with this assessment.

GFA has felt that Throckmorton has been unfair to them and takes them out of context and so they have chosen to stop communicating with him in any efforts to clarify the concerns he raises. In my phone conversation with the GFA rep, he did give me explanations to some of the concerns raised by Throckmorton. However, some of the explanations seemed to me more like trying to put a positive spin on things rather than giving good solid evidence and rationale. Meanwhile, Throckmorton continues to raise more concerns as he uncovers more and more suspicious looking information. Here is a link to all his GFA articles: https://www.wthrockmorton.com/category/gospel-for-asia/

I plead not guilty to this charge. Up to and including the last email from David Carroll, I included the information Carroll sent on behalf of GFA. Here is what he said in his final email:

No, Gospel for Asia has not violated the law.

When you first contacted us, I mentioned that we would not be able to respond to every question you put before us. Now, with the increased volume and frequency of your questions, it has become clear that this back and forth has become a distraction from our mission work. For this reason, this will be my final response. We understand that you will continue to explore issues around Gospel for Asia and continue to be fed accusations from former employees, and we accept that.

We continue to remain accountable to all applicable laws and regulations, to the Evangelical Council for Financial Accountability and to independent auditors.

In his email, Carroll doesn’t accuse me of being unfair or taking him out of context. He said I asked too many questions and for that reason, he was not going to reply. This reason should be of grave concern to donors.

As we now know, GFA did violate the law when they sent groups of students to India each with $4500 in cash in envelopes without declaring the cash to U.S. customs.

The Phoenix Preacher post shows that the questions have only multiplied.

 

Gospel for Asia Admits Money Smurfing; Legal Counsel On Board

In a statement to Christian Today, via comment from the Evangelical Council for Financial Accountability, Gospel for Asia admitted sending cash to India via student groups and ministry partners. From the article by Mark Woods:

GFA is a member of the Evangelical Council for Financial Accountability (ECFA), which made an on-site review of its finances at its headquarters in Willis Point, Texas last week. ECFA told Christian Today: “We found the organisation to be highly transparent and fully cooperative, as I’m sure they’ll continue to be as ECFA continues our review of Gospel for Asia.”

It confirmed that GFA had sent cash with individuals travelling to India, but said that it had “stopped this practice entirely, and is working with legal counsel to determine appropriate remedial measures, if any”.

An organization is not highly transparent when they tell members of the public that they won’t answer questions which have now proven to be legitimate. On a regular basis, I get communications from former donors who tell me that GFA did not answer their questions and David Carroll told me he wouldn’t respond to any more of my emails.

CashOn the money smurfing, it is now clear that the ECFA leaders now know this was happening. We also learn here (not from the “transparent” GFA but from GFA’s public relations spokesgroup, ECFA) that GFA has some idea that legal counsel may be necessary.

There is something wrong with this picture. The financial watchdog group appears to be more interested in damage control for a charter member (GFA) than getting answers for donors. All those years the money smurfing was taking place, GFA was a member in good standing with ECFA. If not for recent disclosures from former students and staff, GFA would still be doing it in violation of their own stated financial standards. However, when discovered, ECFA’s response is to focus on GFA’s claim that it won’t happen again. If ECFA had benefit for donors, it would focus on why GFA sent money to India in the first place.

Recently, a person who had carried cash to India for GFA told me that no explanation was given when the cash was handed out just prior to leaving the U.S. Travelers did not have time to contact family or advisors to ask questions about it. It was just expected. There were no receipts given in the U.S. or in India and no customs forms were completed. The amount in an envelope was $4500.

If you are a student, staff member, ministry partner, or pastor who carried cash out of the United States to another country, please contact me at warrenthrockmorton@gmail.com. We can speak off the record unless you designate otherwise.

How Hard is it for Gospel for Asia to Get Money to the Field?

CashIn a staff meeting on May 14, COO of Gospel for Asia David Carroll said it was getting hard to send money into India.

We’re always looking for ways to get money into India because the reality is that it’s getting more difficult to do that, and we are looking for other ways that we’re able to do that.

Given other information provided by GFA, this is a confusing statement.
On GFA’s frequently asked questions page, GFA addresses financial integrity and tells donors that everything is ethical. On that page, GFA promises financial accountability:
GFAfinancial
 
The sentence underlined in red says: “Some of those systems include transferring funds only through approved banking channels.” Carrying cash in backpacks is not an approved banking channel. As I have reported, money smurfing is a violation of both federal law and this website promise to donors. So hard or easy, moving money is only supposed to be done through banks.
I have to also question if it is difficult to get money into India via legitimate means. According to the audited financial statement for 2012 and 2013, GFA started creating limited liability companies in 2009 to aid transfers of money to India. They now report 12 of them.
A quick review of the Indian FC-6 forms (e.g., GFA’s 2013-2014 FC-6) shows that GFA transfers money frequently. In fact, GFA decided to transfer $9 million to India just to get better interest rates. Apparently, any difficulty was worth it. See the relevant section of the financial statement in the image below:
GFA LLC AFS
 
GFA took $9 million which they needed for their new home office and transferred to that money to India for about a year to get better interest rates. Then they transferred it back. GFA was willing to place $9 million at risk; so how hard could it be to move money back and forth?
GFA has admitted money smurfing but to my knowledge, there has been no explanation to staff about why the students and money was put at risk. I am aware that staff are very concerned about it as they should be.
I encourage anyone who was asked by GFA to move cash on a trip to India (or elsewhere) to contact me at my email address (click the link). If you have questions about the matter, please feel free to contact me.

Former Speaker of the House Dennis Hastert Charged with Structuring Payments

CashAlthough not normally of interest to me, I took a look at the hush money charges against former Speaker Dennis Hastert because of the additional wrinkle that he structured his bank withdrawals to avoid federal requirements to report those actions.
Such structuring is illegal whether one is an misguided creation science proponent, as in the case of Kent Hovind, or a mission organization moving over $10,000 out of the country without declaring it at customs, as former and current students and staff at Gospel for Asia have alleged.
I have learned a new term for using multiple people to move money to evade declaration – “smurfing.” Papa smurf arranges for all the little smurfs to carry the load, in the case of GFA envelopes of cash in their backpacks or suitcases, until they arrive at their destination.
Watch for more on this…